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Unless you’re financially independent and don’t need credit, your credit score is one of the most important indicators of your financial health. But are credit score myths bringing it down?

Over time, it’s possible that you’ve heard — and believed — some myths about your credit score, and these myths could be preventing you from maintaining good credit. To help, we’ve put together a list of 25 credit score myths to show you what’s really true.

25 Credit Score Myths Debunked

1. Myth: If Anyone, Including You, Checks Your Credit Report or Score, It Can Knock Some Points Off of Your Score

Truth:Soft inquiries” don’t hurt your credit. They happen when a company checks your credit for a pre-approval, your employer or landlord checks your credit report, or you check your score. “Hard inquiries,” on the other hand, may impact your credit score, but only occur when you apply for credit.

2. Myth: Carrying a Balance on Your Credit Card Helps Your Credit Score

Truth: Credit card companies are more than happy to charge you interest on a revolving balance, but it’s not necessary to build your credit. Although credit utilization is a part of your credit score, your score improves the lower your credit utilization is. It’s ideal to aim for a usage of no more than 30 percent of your credit limit, but the closer to zero you can get, the better. If you want to use a credit card to build credit, ignore this credit score myth and know that using your credit card and paying it off each month is the best way to go.

3. Myth: You Need to Take On Debt to Build Credit

Truth: You don’t need to take on debt to build your credit score. By using a credit card responsibly each month and paying off your balance in full, you can boost your credit score over time.

4. Myth: Employers Check Your Credit Score When You Apply for a Job

Truth: Prospective employers may sometimes obtain a limited version of your credit report when you apply for a job, but these employment-specific credit reports do not include your credit score. What’s more, the employer can’t even obtain your credit report without your permission.

5. Myth: You Only Have One Credit Score

Truth: Everyone has several credit scores, and they range depending on the version and model you check. Even the most popular credit score, the FICO® score, has a different credit scoring model for basic scoring, credit cards, mortgages, and auto loans. Your score will also depend on the credit report it uses (you have three of those).

6. Myth: Closing an Unused Credit Card Can Help Boost Your Credit Score

Truth: Even if you’re not using an old credit card, closing that card could hurt your credit. That’s because closing the card eliminates the available credit that card was adding to your credit utilization ratio. If you have high balances on your other cards, it could appear as though you’re having a hard time getting by without going into debt.

7. Myth: The Credit Bureaus Calculate Your Credit Score

Truth: There are three national credit bureaus: Experian, Equifax, and TransUnion. These agencies maintain your credit reports but don’t calculate your credit scores. Instead, credit scoring companies such as FICO® and VantageScore® use the information on your credit reports to calculate your credit scores.

8. Myth: Your Income or Savings Can Impact Your Credit Score

Truth: Your credit score only reflects your ability to manage credit, so it’s not influenced by your job, income, or savings. That said, a lender may separately consider your income and savings balances when you apply for a loan.

9. Myth: It’s Easy to Determine How an Action Can Impact Your Credit Score

Truth: Credit scoring models are not only extremely complex, but they’re also proprietary. That means that no one knows exactly how your credit score is calculated but the companies that own the models.

10. Myth: It Takes Forever to Rebuild Bad Credit

Truth: It’s true that you can’t come back from a bad credit score overnight. But over time, new positive credit activity outweighs old negative information. Keep it up, and you’ll see improvements as you make changes in how you handle credit.

11. Myth: Going From Excellent Credit to Bad Credit Takes a Long Time

Truth: It can take a while to prove to lenders that you’re trustworthy. But if you miss a few payments or max out your credit card a few times, you could see an immediate negative impact to your credit score. In other words, make it a high priority to pay all of your bills on time and keep your balances as low as possible.

12. Myth: Credit Repair Companies Can “Fix” Your Credit Score

Truth: Credit repair companies can help you work with creditors and the credit bureaus to remove inaccurate or unfair information from your credit. And once that’s done, your credit score might improve. Some might even monitor your credit and help catch errors early on and provide some guidance to help you make better credit choices. But a credit repair company generally can’t get rid of legitimate activity on your credit report to boost your credit score.

13. Myth: You Can’t Get a Loan If You Have Bad Credit Unless It’s a Payday Loan

Truth: You may still be able to get personal, auto, and even mortgage loans if you have bad credit, but your interest rate will likely be higher than someone with good credit.

14. Myth: You Can’t Get Approved for Credit If You Don’t Have a Credit History

Truth: Not all lenders have loans and credit cards for people with no credit, but there are some out there that specialize in it. Do your research, though. Some lenders charge high fees and interest rates — if you think it’s excessive, it probably is. A secured credit card is often a good way to build credit if you have no credit history.

15. Myth: Everyone Has a Credit Score

Truth: If you haven’t had any credit activity in the past six months — or ever — chances are that you don’t have a FICO® credit score. Other credit scoring models like VantageScore®, however, might still have a score for you if you’ve used credit in the past.

16. Myth: If You Have Excellent Credit, You’ll Never Get Denied

Truth: Your credit score is just one piece of the puzzle for lenders. They’ll typically also look at your overall debt load, income, recent inquiries, and other factors. If one or more of those don’t meet the lender’s requirements, you might still not get approved.

17. Myth: Achieving a Perfect Credit Score Is the Goal

Truth: An 850 FICO® or VantageScore® credit score is as high as you can get, but it’s unlikely to make that much of a difference for you than if you had a 780 credit score. If you’re a perfectionist, find something else more worthwhile to focus on (such as your credit score range).

18. Myth: You and Your Spouse Have a Joint Credit Score

Truth: You and your spouse have and always will have separate credit reports and scores. The only time your spouse can affect your credit is if you are both named on a credit account together.

19. Myth: FAKO Scores Aren’t Worth Your Time

Truth: Educational credit scoring models are often called FAKO scores because they’re not as commonly used by lenders and instead used mainly by consumers eager to learn where they stand. These educational scores often closely mirror those used by lenders. Plus, we each have dozens of different FICO® scores, so there’s going to be variability with the “real” scores, too.

20. Myth: Getting Your FICO® Score Is Impossible Unless You’re Willing to Pay for It

Truth: Through the FICO® Open Access program, it’s easier now than ever to see your FICO® score for free. If you have a credit card, for instance, your issuer might offer it as a benefit. If not, Discover Credit Scorecard offers access for free to anyone who registers.

21. Myth: Credit Scores Update Every One to Three Months

Truth: Your credit score can change as often as every day, depending on when and how often your creditors report information to the credit bureaus. So while a credit monitoring service you use might only update your score weekly or monthly, it could still change in between those updates.

22. Myth: You Can Build Credit With a Prepaid Debit Card

Truth: Since prepaid debit cards don’t have a credit element, they can’t help you establish a good credit score.

23. Myth: Your Rent and Utility Payments Can Help You Build Your Credit Score

Truth: Landlords and utility companies typically don’t report your payment activity to the credit bureaus, though there are efforts underway by credit bureaus to begin reporting these payments, and in some relatively rare cases a positive rental payment history may show up on your credit report. That said, if you start falling behind on payments, they might send your account to collections, which likely will show up on your credit reports.

24. Myth: It’s Not Helpful to Check Your Credit Score Frequently

Truth: Even if you’re not working on improving your credit score, it’s best to check at least once a month. That way, if you see an unexplained drop, you can get ahead of a problem, such as an error or fraudulent account, that’s hurting your score. (Read this to learn how to spot mistakes on your credit report.)

25. Myth: Paying Off Negative Debt Boosts Your Credit Score Immediately

Truth: If you have late payments, an account in collections, or even a bankruptcy, it can take seven years or longer for that negative item to fall off your credit report. That’s the case even if you pay it off. So, while it’s a smart move to get caught up on payments to avoid further damage, it will still take time for your score to recover.

[FREE TOOL: Are mistakes on your credit report hurting your credit score? Find out with Upturn Credit’s free credit repair tool.]

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